Photo/IllutrationHundreds of storage tanks on the grounds of the crippled Fukushima No. 1 nuclear power plant contain water contaminated with radioactive materials. (Asahi Shimbun file photo)

The economy ministry is weighing the introduction of a subsidy system paid to electricity producers who use nuclear plants to offset massive costs to meet tougher safety standards after the 2011 disaster.

Officials said that those expenses have cut into the cost competitiveness of nuclear energy to such an extent that a subsidy system may have to be utilized, despite its longtime contention that nuclear energy is the most economical form of electricity generation.

Given that the subsidies will end up being padded onto the electricity bills of households and businesses, it remains to be seen if the public will go along with shouldering the additional burden.

The ministry plans to establish the subsidy system by the end of fiscal 2020 in line with the scheduled review of the "feed-in tariff" system that set prices for purchasing electricity generated by solar and other renewable sources.

According to several sources and internal ministry documents, the plan would allow electricity producers that use nuclear plants to add a certain percentage to the price for which they sell the electricity to retailers. The reasoning among ministry officials is that nuclear energy provides added value as it does not pollute the environment or emit greenhouse gases.

The ministry's proposal is modeled after the zero-emissions credit introduced in New York state that provides support to nuclear plants so they can continue generating electricity.

Despite the higher expenses needed to meet tougher safety standards for nuclear plants in Japan, the government continues to describe nuclear energy as a "base-load energy source" and it has set a target of increasing the ratio of electricity generated through nuclear energy to between 20 and 22 percent of total energy needs by fiscal 2030.

Also in that year, the government will begin requiring electricity retailers to procure 44 percent of sales output from non-fossil fuel energy sources, such as nuclear energy or renewable energy sources.

Because of that obligation, retailers may eventually be forced to procure a certain ratio of electricity from nuclear producers, even if the subsidies make that form of power comparatively more expensive.

Households and companies that purchase their electricity from such retailers would end up footing the bill.

However, public opinion surveys continue to show opposition to the resumption of operations at nuclear plants at levels close to double those who are in favor.

That opposition may make it more difficult for the economy ministry to push ahead with its subsidy program.

Liberalization of the electricity market has also effectively done away with the regional monopolies once enjoyed by electric power companies. Producers who use renewable energy sources, such as wind and solar, can now sell their electricity to a much wider range of consumers, further intensifying cost competitiveness among different energy sources.

A further spread of renewable energy will only make the situation facing nuclear energy even more difficult.